(Unsaid here is that, while in every year some (14% in 2014) fund managers beat their benchmark index, 0% of fund managers beat their benchmarks consistently year after year.)

“It is very difficult to outperform the benchmark over a long-term investment horizon. And these were professional money managers… If they can’t beat the benchmark, what does that mean for the average investor?” [trying to do the same by stock-picking].

Even in periods of high volatility like 2001 and 2008 when Wall Street argues that professional stock-pickers actually earn their keep, most fund managers did not beat their benchmark.

Wall Street also alleges active fund managers particularly add value in small capitalization, emerging & international markets, and down-trending markets. In reality, over 3, 5, and 10-year horizons, managers in these categories underperformed their benchmark.

And this is astonishing: Even if you add back to active funds’ performance the management fee extracted from shareholders’ pockets by professional money managers, active funds still underperformed the benchmarks. Wow. This literally means an average chimpanzee is a better stock picker than the average Wall Street money manager.

Should this be posted at the NYSE?

I have to ask again: Why shouldn’t we regard the entire active fund management industry to be a fraud, if not legally then at least ethically? Why isn’t the SEC advising consumers to invest in low-cost index funds only?

Here’s the reality, folks:

Active manager fund fees crush investment performance. What is passed off on Wall Street as financial analysis is actually pure salesmanship, a self-serving marketing message intended to separate you from your money, not boost your retirement security prospects. It’s bad enough that stocks are far riskier than you probably think (thanks to Wall Street marketing); you’re being duped into paying for fund managers’ yachts and getting negative performance (relative to indexes) in return.

No human being on the planet can consistently beat index fund performance. You certainly can’t, and no Wall Street money manager can.

You will retire with more wealth if you never invest in actively managed funds, period.

Tweeters of the world, unite!

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